The June quarter household labour force survey surprised forecasters with a 0.1 percentage point rise in the unemployment rate to 6.8 per cent, rather than an anticipated fall.

However, the MBIE forecasts see unemployment falling to 6.2 per cent in March 2013 and 5.9 per cent in March 2014, about eight months out from the next scheduled general election.

The report expects a gradual pick-up in employment rates to continue, and for the number of people willing to work rising to a historically high 69.5 per cent, compared with 68.8 per cent at present.

"The domestic recovery is expected to accelerate as the Canterbury rebuild ramps up," MBIE says. "This will lead to a steady improvement in the labour market, with moderate employment growth in the short-term. However, regional and industry variation will persist."

The newly minted ministry is now publishing labour market statistical analysis and forecasts previously provided by the Department of Labour, which was included in a "super-ministry" merger to create MBIE earlier this year.

"Given the weak pace of the current economic recovery, employment growth looks strong compared to the 1997/98 experience", when the bounce-back in economic growth was far stronger than the current prolonged, shallow recession.

The ministry forecasts the rate at which new jobs are created to rise from 1.4 per cent this year to 2.1 per cent in 2014.

A resilient performance by people over the age of 55 is a notable feature of current labour market dynamics, the report says, noting participation rates by older people are "very high" by international standards.

A steady increase in workforce participation by older workers added more than 40,000 people in the last five years, accounting for one-third of the total increase in the labour force in that time.

"This is attributable to both the increase in participation and the bulge in this cohort as baby boomers move towards this age group," the MBIE report says. "The high participation of New Zealand's ageing population retains human capital, skills and knowledge in the workforce for longer. This helps sustain the income required to maintain living standards."

Migration flows are also "very large" relative to the size of the total labour force, the report says.

"For example, in 2011 there were 84,000 permanent long-term immigrants - much larger than the 58,000 school leavers in that year", with temporary working migrant inflows even greater.

Even so, there was a net long term migration loss to the country as a whole, mainly to Australia, and an 11 per cent fall in the number of migrants applying under the skilled migrant category.